Grexit is now less dangerous for the Eurozone

In a full-page interview in the Greek newspaper “Kathimerini” on Sunday, January 11, 2015, Michael Haliassos describes where the Greek adjustment program of the past five years has gone wrong, and why Greece has no room for creating further uncertainties and risk for the euro zone. With regard to the latter issue, if Greece creates uncertainty about its commitments to reforms and to the euro, it is likely to be asked to choose between accepting harsh measures and staying; or leaving the euro and the EU and surviving on its own. It can no longer “threaten” to do the latter, as it has come to be considered a “special case” that is not of systemic importance. Greece should go on with the reforms necessary to create productive potential instead of creating uncertainty among other euro zone countries. Read the article.